Wednesday, 26 October 2011

Ag Emissions: What is our Goal?

The AgDialogue group is made up of farmers, Government officials and NGOs united by a desire to ensure New Zealand leads the world in finding solutions to agricultural emissions. I find that being part of this group is a unique opportunity to push past the entrenched rhetoric on climate change and start to find solutions that could really work.
Debating these issues through the media does not seem to be constructive for such an important long term issue, as each side lobs their sound-bites into the battle zone, further entrenching their own positions. This is the worst possible situation for such an important issue. The evidence indicates that climate change requires urgent action, and New Zealand is uniquely placed to lead on a response to agricultural emissions. Adapting to a low emissions world will take time to learn new skills and make the necessary investments, all of which needs to start now. However, without greater certainty no one in their right mind will start to make the necessary changes.
Yet once we agree what we want to achieve, Kiwis are notorious for being able to get on and make it work. The difficult times we faced as a nation in the 1980s pushed us towards some world leading actions on natural resource management (fishing) and agricultural subsidies. Sure, we made some mistakes in implementing the change, and the shift certainly was tough, but the fact that today we have among the strongest farming and fishing sectors in the world is a testament to our resilience, determination and creativity. The difference in the 1980s was that the changes were forced upon us. If we act now, we could lead the world once again and most importantly we could do it on our own terms.
Discussions about what we are trying to achieve, or where we are heading, are all too rare in New Zealand. We are a practical nation, deeply suspicious about concepts and strategies, preferring to focus on what we are going to do. This is great, and is probably the reason we are so successful at solving problems once they become clear. The trouble is that sometimes when the battle is waged over the policies alone, what we are actually trying to achieve is obscured from view.
All our national discussions on climate change have focussed solely on one tool, and a flawed one at that: the Emissions Trading Scheme. Should agriculture be in or out? This narrow line of questioning completely misses the point. Once we have agreed what we are trying to achieve with agricultural emissions, it is simply a matter of working out how to do it. We have shown time and again that if we work together, this bit of the process is easy. Any change always creates winners and losers, but we are a small country, and we can work these things out.
The first tranche of the AgDialogue sessions have focussed very much on what our aim should be, and I am aiming to distil, for discussion, what I have taken from the conversation so far.
Our Vision is that over the next 20 years New Zealand lays the groundwork for having the lowest possible emissions for each amount of food we grow by 2031.
But we aren’t agnostic about how this is achieved. Along the way we also expect that:
Incentives are faced by those that can make a difference to emissions – the point of obligation must be on the farmer, otherwise the charge is merely a tax.
Provide the maximum possible certainty to make long-term investment decisions – we need wide bi-partisan agreement on the way forward so that farmers can start planning and adapting.
Costs are borne by those who cause the greatest impact – we need to make sure that the way we account and charge for emissions actually matches their impact on the environment. It is not clear that this is the case for methane under the approach we have adopted from Kyoto.
Any incentives to reduce emissions actually work – price based systems are not a silver bullet, consideration needs to be given to softer approaches like advice and skills development. There is also little point charging for emissions that can’t yet be reduced; again, the way we currently account for methane is under question here.
The creation of environmental limits is consistent across all areas – we need to be aware of the other environmental constraints that are developing (such as water quality), and ensure that whatever is agreed works in those areas too. In particular the way we deal with nitrous oxide emissions has to dovetail with concerns about nitrogen leaching into rivers. Killing two birds with one stone should be the goal.
Balance long term investments and short term profitability – we want incentives to encourage farmers to prepare for and invest in the long term. This will mean that when the world acts on emissions, we will be in a pole position to benefit. However, this system shouldn’t cause production to move overseas to countries without similar incentives in the short term. Modelling indicates this shouldn’t happen with carbon prices around $25 per tonne (even without free allocation).[1]
Give farmers time to adapt – introduction should be staged to allow farmers time to adapt and minimise social upheaval.
In the 1980s we didn’t have the luxury of time to consider how to act, we simply had to do something. If we don’t begin dealing with emissions now, then we face the risk of another 1980s moment where change is needed immediately, regardless of the side effects and upheaval that may cause. On the other hand if we act now, we have the luxury of taking charge of our own destiny and facing the future on our own terms. This will not be easy, but is far more attractive than putting our head in the sand and hoping for the best.